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    New pension system on its way

    The preparatory process went differently than expected, but a new pension system finally appears to be on its way. At the beginning of this month, a majority of the members of the FNV (Netherlands federation of trade unions) voted in favor of the planned elaboration of the pension agreement, made at the beginning of 2019. After a year of countless discussions and calculations, the voting by the FNV was the final piece of the negotiation puzzle. The plans are now being converted into legislative proposals. The government of the Netherlands will deal with these proposals in 2021, so that the new rules guiding the transition toward the new pension system can go into effect on January 1, 2022.

    Transition plan

    According to the Cabinet of the Dutch Government and its social partners, the new pension system will make pensions more personal and transparent. Current retirement plans where the height of the pension is dependent on one’s average or final salary in their lifetime (middelloonregeling and eindloonregeling respectively in Dutch) will be discontinued; instead, all employees will receive the same retirement plan, the beschikbarepremieregeling (a pension plan where the height of the pension is based on paid pension contributions). The transition to the new system is impactful and complex. This is why a transition period has been created. From 2026 on, all pension providers and plans must conform to the new system. This means work for your organization too. For example, you may have to draw up a transition plan.

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